Plotting diet change for China
By Olga Galacho
21jan04
CHINESE dinner tables are on the menu for Simplot Australia as the processor of frozen and canned foods tests the retail market in the world's most populous nation.
Next month, a team of Simplot executives will travel to China to receive the first findings of a study the company is conducting into the feasibility of establishing a "retail imprint" there.
Simplot Australia, which assumed responsibility for Chinese and South-East Asian markets from its Idaho parent late last year, already has a plant in China producing chips for the likes of McDonald's and other food service industries.
The company is now evaluating whether the retail sector can provide opportunities that may flow from the increase in household freezer ownership in China.
Managing director Terry O'Brien and chief financial officer Thilo Schindler told the Herald Sun yesterday it was too early to tell what form a possible business would take, but "it would not necessarily be an export initiative".
The study will be completed this year and Mr O'Brien said Simplot expected to have a retail footprint that may involve food processing plants in China within three years.
Simplot, which supplies 70 per cent of the fried potato chips sold in Australian fast food outlets, is moving away from a "heavy weighting in tasty foods" high in fat, salt and sugar, and expanding its healthy products, such as canned tuna and salmon.
In July, it bought the John West label from Unilever and sold its pie business, which included the Four'n Twenty and Nanna's brands.
Other brands in the Simplot stable include Chiko rolls, Birds Eye, Leggo's, Edgell and Plumrose.
Mr Schindler said the Australian holding company was on track to achieve net sales of $829 million this financial year, which was an increase of $100 million.
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